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Conducting a feasibility study

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작성자 angelica 댓글 0건 조회 1,958회 작성일 14-01-26 06:23

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2.3.1. Introduction

Aspiring entrepreneurs may have an idea about the type of fruit or vegetable product that they would like to make. This can come from seeing others successfully producing a food and wanting to copy them or from talking to friends and family members about products that they think they could make. However, an idea for a business is not a sufficient reason to begin production straight away, without having thought clearly about the different aspects involved in actually running the business. Too often, people invest money in a business only to find out later that there is insufficient demand for the product or that it is not the type that customers want to buy. To reduce this risk of failure and losing money, potential producers should go through the different aspects of running their business in discussions with friends and advisers before they commit funds or try to obtain a loan. This process is known as doing a feasibility study and when the results are written down, the document is known as a business plan.
Conducting a feasibility study need not be difficult or expensive, but the most important aspects should all be taken into account to ensure that potential problems are addressed. These are summarised in the Feasibility Study Checklist in Appendix III and are described in more detail in other Sections of this book. In this Section, the following questions that can be answered by a feasibility study are addressed:
· is there a demand for the produce?
(Find out the characteristics required of the product and the size and value of the market)
· who else is producing similar products?
(Determine the number and type of competitors)
· what is needed to make the product?
(Find the availability and cost of staff, equipment, services, raw materials, ingredients and packaging)
· what is the cost of producing a product?
(Calculate the capital costs of getting started and the operating costs of production)
· what is the likely profit?
(Calculate the difference between the expected income from sales to an estimated share of the market and the costs of production)
Each of these aspects should be looked at in turn. When all the information has been gathered and analysed, it should be possible to make a decision on whether the proposed investment in the business is worthwhile or whether the producer's money could be better spent doing something else. The same considerations should be taken into account when an existing entrepreneur wishes to diversify production or make a new product.
It is also important to remember that the business plan is a working document that should be used as a framework to guide the development of a business. To do this it should be regularly updated. However, it often happens that an entrepreneur pays an adviser or consultant to prepare a business plan but then does not understand the contents, or having read it once, puts it away on a shelf never to be seen again. In the following parts of this Section, the above aspects are described in a systematic way, as should be done in a feasibility study, starting with 'The Market'.

2.3.2. Market analysis



Once a potential producer decides that he wishes to start a business, the first thing to do is to find out what is the likely demand for the fruit or vegetable product that he or she wishes to make, by conducting a short market survey. Although there are market research agencies that are able to do this type of work in many developing countries, it is better for producers to do it themselves (if necessary with assistance from partners or advisers) because they will then properly understand their customers' needs and how their business should operate. If an idea is found to be feasible, this knowledge will in turn give them the confidence to go ahead when problems are encountered, knowing that their product is in demand.
Although telephone or posted questionnaires are possible, in most developing countries it is better to conduct a market survey by going out into areas where the producer expects to find consumers and asking people for their views. There are two types of information that are needed:
1) information about the product and its quality and
2) information about how much people will buy, how often and for what price.
It is important to think in advance about the type of information that is needed and to ask people the same questions each time, so that their answers can be compared and summarised. This should be a short exercise to keep the costs low and in-depth market research is not necessary for most products. A convenient way of doing this is to prepare simple questionnaires such as those shown below, which can be used by entrepreneurs to remind themselves of which questions to ask.

Product quality survey

Consumers are familiar with the types of fruit or vegetable products that are already on sale and surveys on these products are therefore easier than those for a completely new food. Questions can focus on what are the things that consumers like or dislike about existing competitors' products. For example in Figure 29 the questionnaire is used to ask questions about the qualities of chilli sauce.
However, if producers wish to make products that are new to an area, they need to have samples for potential consumers to taste and give their opinion on whether they like the product and would be willing to buy it. (When asking people to taste a product, a supply of spoons should be taken so that each person interviewed uses a clean one). Samples can usually be made at home using domestic equipment so that an investment in production facilities is not needed at the this stage. An example of a questionnaire for a new product is shown in Figure 30.
Although initially, new products have the advantage that there will be no competitors, the process of assessing demand takes longer and costs more than for products that are already known. In addition, as up to 80% of new products fail, the risks are higher and it may be more difficult to get a loan for this type of work.
Figure 29. - Example of a survey questionnaire on the quality of competitors' chilli sauce
Questions
1
2
3
4
5
Very good
Good
Average
Bad
Very bad
1.
Which make(s) of sauce do you by most often?
Write names of sauce(s)
1.
What do you think about the colour of the sauce you buy?
Tick in the appropriate place
2.
What do you think about the seeds being present in the sauce?
3.
Do you like the thickness of the sauce?
4.
What do you think about the flavour of the sauce?
5.
Do you like the bottle?
6.
What do you think about the label?
7.
What do you think about the price of the sauce?
8.
Is there anything else that you think is good about the sauce that you buy at present?
Write answers
9.
Is there anything else about the sauce that you buy that you would like to see improved?
Write answers
Remember that the customer (the person who buys the food) is not always the same person as the consumer (the one who eats the food). This is particularly important when getting information about the quality of foods that are mostly eaten by children, as their preferences for colour or sweetness may be different to those of their parents (see also Section 2.8.1). For food producers, customers can also be retailers or other sellers in addition to institutions, other food processors and members of the public.
The results of such surveys can be analysed by adding together the numbers of people that gave answers such as 'very good', 'poor' etc. In the example below, the answers to questions about chilli sauce (Table 12) show that among other information, 88% of people found the colour of the sauce to be better than average, 78% did not like having seeds in the sauce and 60% found the flavour to be good or very good.
Other information that can be gained by analysing the data includes:
1. a large majority of consumers liked having sauce in a bottle and that they were happy with existing labels. This information helps to show a new producer what type of packaging must be used if he/she is to compete effectively with existing manufacturers or imported foods.
2. A majority of consumers (52%) were unhappy with the price of the sauce and this indicates that a potential market share exists, if a new product having a similar quality can be sold more cheaply.
Figure 30. - Sample questionnaire for a new product (tomato jam)
Explain to each person you interview that you wish to start a new business making tomato jam and that you have prepared some samples for people to try. Ask them if they would like to taste the sample and give you their opinion on what it is like.
Question
Answers
1. Do you eat other types of Jam?
Yes/No...................... Circule answer
2. Which types of jam do you like best?
List the types
3. Do you think you would like tomato jam?
Yes/No/Not sure...... Circule answer


1
2
3
4
5
Very good
Good
Average
Bad
Very bad
4. What do you think about the colour of this tomato jam?
Tick in the appropriate place
5. Do you like having the seeds in the jam?
6. What do you think about the flavour of this jam?
7. Do you like the texture of the jam?
8 What do you think about the jar?
9. What do you think about the label?
10. What else do you like about this jam?
Write answers
11. Is there anything that I can do to improve this jam?
Write answers

Survey of market size and value

A different set of questions are needed when assessing the size of the market for a particular type of food (the total weight of product that is bought per month or per year) and the value of the market (the amount of money spent on that product each month or year). At the same time it is possible to gather information about the types of people who buy a particular food and where they buy it. A sample questionnaire is shown in Figure 31.
The information gathered from potential consumers, using questionnaires like the ones in Figures 29 to 31, can be analysed by the entrepreneur to get a good idea of the quality characteristics of the product that consumers prefer, the total demand for the product and the total value of the market. However, this involves making a number of assumptions and it is important to consider the following:
1) are the people interviewed really representative of all potential consumers?
2) were enough people interviewed?
3) were people giving accurate information?
Table 12. - Data collected about consumers' opinions of the quality of a product
Question
Summary of 50 replies
1
2
3
4
5
Total
Very good
Good
Average
Bad
Very bad

1. What do you think about the colour of the sauce you buy?
12
32
5
1
0
50
2. What do you think about the seeds being present in the sauce?
5
6
16
14
9
50
3. Do you like the thickness of the sauce?
10
20
12
7
1
50
4. What do you think about the flavour of the sauce?
42
8
0
0
0
50
5. Do you like the bottle?
40
10
0
0
0
50
6. What do you think about the label?
10
11
20
9
0
50
7. What do you think about the price of the sauce?
5
7
12
25
1
50
If a producer is unsure about the quality of information that has been given, he or she should ask more people the same questions to check the answers obtained. Clearly, the more people that are interviewed, the more accurately does the information reflect the real situation. However, a balance has to be drawn between the time and cost of interviewing large numbers of people and the accuracy of the data that is obtained. As a guide, 50-75 interviews should result in a good idea about the market for a product in a particular area.
When analysing data collected about market size and value, it is often helpful to find official statistics about the people who are expected to be the customers for a new product. For example in Table 13, information was collected using a market survey of chutney consumption in a small Asian town and analysed together with data from the Census Office and a previous socio-economic survey about the size and wealth of the town's population. Similar information is sometimes available from Local Government offices, tax authorities and Chambers of Commerce, although it may not always be up to date.
Figure 31.- Sample questionnaire about market size and value
Questions
Answers
About the market size:
1. How often do you buy this product?
Daily/weekly/monthly
2. Do you buy different amounts at different times of the year?
(Circle answer)
Yes/No (Circle answer)
3. When are the times that you buy the most?
Write answer
4. How much do you buy each time?
Write amount in kg or No. Packs
5. When are the times you buy the least?
Write answer
6. How much do you buy each time?
Write amount in kg or No. Packs
7. What is the amount of food in the pack?
Write amount in kg
About the market value:
8. How much do you pay for a pack of the food?
Write the amount in currency
9. What is the price difference for larger or smaller packs?
Write differences
10. Does the price change at different times of the year?
Yes/No (Circle answer)
11. When is the price highest?
Write answer
12. When is the price lowest?
Write answer
About the customer:
13. Would you say that you have a low, medium or high income in your household?
Low/medium/high (Circle answer)
14. In which age group do you belong?
Tick answer

1-20


21-40


41-60


Male/Female
M/F (Circle answer)
About sales outlets:
15. Where do you usually buy this food:
Tick answer

Market stall


Local shop


Kiosk


Supermarket


Street hawker


Directly from producer


Other
Write answer
Table 13. - Potential market for chutney in a small Asian town
Type of customer
Number in each category*
Amount of chutney bought per month (kg**)
Amount of chutney bought each time (kg**)
Low income
18,430
0.4
0.1
Medium income
5,485
1.2
0.15
High income
192
2.25
0.45
* from official census statistics for the town
** average of information given by 70 customers interviewed
The cost of chutney in the market was $3.9 per kg when sold in 100g amounts from a bulk container into customers' own pots (bought by the majority of those who said they were in low income families), $4.1 per kg when sold in 150g plastic bags (bought mostly by medium income families) and $4.8 per kg when sold in 450g glass jars (bought mostly by high income families). This data can be analysed, as shown in Tables 14 (a) and (b), to calculate the total size and value of the chutney market in this town.
The size and value of the market, calculated in Table 14, indicate that low income and medium income families form the largest part of the chutney market in this town. These people were found to buy the product either from bulk containers into their own pots, or pre-packed in plastic bags. The demand for jars of chutney was limited to high income groups which formed only 3% of the market size and 3.8% of its value. A new business would therefore be likely to focus on low and medium income families as its potential consumers. This has implications for not only the type of packaging that is used but also the types of advertising, methods of promotion and agreements with retailers that should be considered. These aspects are described in more detail in Section 2.8.
Table 14 (a). - Calculation of the size of the market for chutney
Type of customer
Number in each category
Amount of chutney bought per month (kg)
Total demand (kg per month)
Low income
18,430
0.4
7,372
Medium income
5,485
1.2
6,582
High income
192
2.25
432
TOTAL

14,386 kg
Table 14 (b). - Calculation of the value of the chutney market
Type of customer
Amount of chutney bought each time (kg)
Cost per kg of chutney ($)
Number of kg
Value of market ($ per month)
Low income
0.1
3.9
7,372
28,751
Medium income
0.15
4.1
6,582
26,986
High income
0.45
4.8
432
7,882
TOTAL

$63,619

Market share and competition

Market surveys and the calculation of market size and value are important to find out whether the demand for a product really exists, but these figures should not be assumed to represent the scale of production that could be expected. Even if no-one else is currently making a product locally, it is likely that once a new business starts production and is seen by others to be successful, they too will start up in competition. It is therefore important from the outset, to estimate what is the proportion of the total market that a new business could reasonably expect to have. This is known as the market share. It is often difficult to estimate a realistic market share and the figure depends on a large number of variables, but Table 15 can be used as an initial guide. In many cases, new entrepreneurs over-estimate the share that they could expect, with the result that production operates at only a small proportion of the planned capacity. The lower percentages in Table 15 should therefore be used initially. Section 2.3.4 describes some of the negative effects on finances of operating a business below planned capacity.
In the example described in Tables 13 and 14 concerning the market for chutney, there were a large number of small producers all making similar products. The estimated share of the market for a new producer can therefore be calculated as follows:
Total size of the market = 14,386 kg per month
Estimated share = 5-10%, with 5% selected.
This represents sales of 719 kg of chutney per month with a potential value of $3,181 per month.
When converted to daily production rates, assuming 20 working days per month, the maximum production is therefore 36 kg per day
This figure for daily production rate is very important. It is central to all subsequent calculations of production capacity and investment requirements (below) and every care should be taken to ensure that this information is as accurate as possible.
It should be noted that in the calculations below, the scale of production is based on an anticipated share of the total market. In other situations, a more detailed analysis of market segments could be made (Section 2.8.1) and the planned market share could be based on one of those segments (e.g. low income groups in Tables 13 and 14).
Competitors are very important to the success or failure of a new business and the entrepreneur should recognise that there are different types of competitor. Using the example of someone wishing to make fruit juices, it is helpful to think how the consumers might view the available products: for example when they are thirsty, they have a choice of hot drinks (tea, coffee etc.), cold soft drinks, such as milk, juices, squashes or finally alcoholic drinks. These are all general competitors, who are able to satisfy the consumers' thirst. Supposing the consumers choose cold soft drinks that can be drunk straight from the bottle, they then have a choice between carbonated (fizzy) soft drinks, and juices. These are known as type competitors or different kinds of soft drink. Finally, on choosing juices, there are different juices and different brands of the same type of juice, which are brand competitors.
Although the appearance and quality of foods are important, competitors do not just compete with their products. They also compete with the profit margin and level of service that they offer to retailers and with special offers or incentives to customers. New entrepreneurs must therefore assess each of these factors when deciding what the competition is and how to deal with it. This is conveniently done using a SWOT analysis, where SWOT stands for Strengths, Weaknesses, Opportunities and Threats.
The technique involves looking at each aspect of the new business and comparing it to other producers, particularly type and brand competitors.
Many new entrepreneurs do not appreciate the importance of finding information about competitors and even if they do, they may not know where to find it. In addition to the direct questions to consumers in market surveys described above, entrepreneurs can get information about competitors from the following sources:
1. discuss with retailers the amount of sales of different brands and any seasonality in demand. What are the trends in consumers' buying, what is getting popular and what is going down? What types of consumers buy particular products and how often? Does the retailer put on any special displays for some suppliers? What do they think about the idea for a new product and do they think they will sell a lot of it? What are their plans for the future?
2. look at competitors' advertising and retail displays, get a copy of their price lists.
3. ask the local Employer's Federation or Chamber of Commerce for any information
they have on the market for similar products.
4. visit trade fairs and talk to other producers and their customers.
5. look in trade journals, manufacturers' association magazines and newspapers for information about the market and the activities of competitors.
Table 15. - Estimates of market share for a new food business with different levels of competition
No. of other producers
Many
Few
One
None


Size of competitors
Large
Small
Large
Small
Large
Small
Product range
S
D
S
D
S
D
S
D
S
D
S
D
Market share (%)
0-2.5
0-5
5-10
10-15
0-2.5
5-10
10-15
20-30
0-5
10-15
30-50
40-80
100
S = similar products, D = dissimilar products
(From Do Your Own Scheme, Anon)
After finding as much information as possible, the entrepreneur can then start to compare the new business with those of competitors using the SWOT analysis. An example of how it might appear is shown in Table 16.
When it is completed, the entrepreneur should be able to answer the following questions:
· who is producing similar products?
· where are the competitors located?
· what is the quality and price of their products?
· what can I do to make a new product that is better than those of competitors?
· why would customers or consumers want to change to a new product?
· what offers or incentives do competitors give to retailers?
· what are competitors likely to do if a new product is introduced?
The answers to these questions are then used to formulate a marketing strategy, details of which are described in Section 2.8.2.
The analysis in Table 16 indicates that one competitor (A) has a range of good quality products that are packaged and promoted well, but they are more expensive and do not meet changing consumer requirements. The other competitor has a cheap product that is not well packaged and not promoted. However, it sells well because the low price attracts low income consumers and retailers promote it because of the higher margins offered by the company. They appear to be expanding to new areas. However, retailers are annoyed when Competitor B fails to deliver on time or in the correct amount and they may have over-stretched their distribution capacity. The analysis points the way to producing a product without additives and to providing a good service and equivalent margins for retailers. It also highlights lack of information about process inputs (e.g. packaging) and production costs. These are discussed in the Sections below.

2.3.3. Technical feasibility



Once an entrepreneur has found information about potential consumers, their requirements and the likely share of the market that could be obtained for a new product, it is then necessary to assess whether production at this scale is technically feasible. The series of questions below is helpful in deciding the technical requirements of the business:
· are enough raw materials available of the correct quality when needed for year-round production?
· is the cost of the raw materials satisfactory?
· is the correct size and type of equipment available for the expected production level and at a reasonable cost?
· can it be made by local workshops and are maintenance and repair costs affordable?
· is sufficient information and expertise available to ensure that the food is consistently made at the required quality?
· are suitable packaging materials available and affordable?
· are distribution procedures to retailers or other sellers established?
· is a suitable building available and what modifications are needed?
· are services (fuel, water, electricity etc.) available and affordable?
· are trained workers available and are their salaries affordable?
Table 16. - Example of a SWOT analysis of a new business in relation to competitors

My proposed business
Competitor A
Competitor B
Strengths
Production likely to be sited close to retailers can deliver at short notice.
Good brand image and range of products.
Product is cheaper than A and sells well They offer good margin to retailers.
Weaknesses
Difficult to find good packaging.
Products more expensive than B. Uses synthetic colours and preservatives.
Poor quality product, poor label design. I'm told by retailers that supplies are irregular and not always the amount ordered.
Opportunities
Retailers say demand for products without additives is increasing. I can produce without added colours.

Appears to be expanding deliveries to new areas according to newspaper reports.
Threats
Strong promotion by A. There are few wealthy consumers and price is most important factor. I am not yet sure of production costs.
Cheaper products than B.
May have over-expanded distribution network and failing to make deliveries.
(Adapted from: Starting a Small Food Processing Enterprise, by Fellows, Franco and Rios)

Production planning

The answers to these questions can be found by first setting down a plan of the production process in a similar way to the process charts described in Section 2.2. This plan should indicate how the different stages in a process are linked together, identify any 'bottle-necks' in the process, the equipment that is required for each stage and where quality assurance procedures should be used. The data that has been found from market surveys is added to the process chart to indicate the scale of production that is required (e.g. Figure 32, which uses chutney as an example).
The chart is also used for planning a number of different aspects of the production process, including:
1) the weights of raw materials and ingredients that should be scheduled each day,
2) the number of workers and their different jobs,
3) the size of equipment required to achieve the planned throughput of product
4) the number of packages that are required each day.
In the example, the market information for chutney sales indicated that a minimum production rate of 36 kg per day would be needed to meet the anticipated initial market share. Assuming that production takes place for 8 hours each day for 20 days per month, the average throughput would be 4.5 kg per hour (36/8 kg). This throughput figure is critically important in all subsequent planning and every effort should be made to ensure that it is as accurate as possible by checking all assumptions carefully. In particular, the number of assumed working days may fall below twenty if there are regular power failures or if production planning (Section 2.7.1) is inadequate. The different stages of production planning are described below.
Figure 32. - Modified process chart showing scale of operation and daily requirements for mango chutney production
Processing stage
% losses
Weight of mangoes (kg)
Batch size (kg)
Processing time (minutes) from Figure 33.
No. of workers
Minimum equipment size (kg/hr)
Mangoes
0
60




Wash
14
60




Sort
45
51.6

90
2
Table for 2 workers
Peel/destone
0
28.4




Cut

28.4

120
3
Table for 3 workers, 3 knives
Mix
0
27
27 kg sugar + 13.51 vinegar for batch of 60.7 kg.



Boil
34*

40
180
1
Boiling pan for 10 kg batches. Two filters and heat sealers. Table for 2 people
Fill/seal
10

36
180
2
Cool/label
0

36
120
1
Store
0

36


Weight of product


36


* evaporation losses during boiling. Note: recipe described in Figure 13.
Notes on calculations:
Boiling results in weight losses of 34% as water is evaporated and the solids content increases to 70% (see calculation below). If each batch takes 20 minutes to boil, there are 2 batches per hour and in 3 hours there are 6 batches of 10 kg each to meet production target of 60 kg of raw materials, yielding 36 kg of product per day. Therefore the boiling pan should have 10 kg working capacity (that is a 12-15 litre pan).
Each worker fills and seals 40 bags per hour = 120 bags per day x 2 workers = 240 bags of 150g net weight = 36 kg per day
Calculation of boiling losses:
The solids content in the mix of ingredients before boiling is found as follows:
Ingredient
Weight (kg)
Solids content (%)
Weight of solids (kg)
Mangoes
27
15
4.05
Sugar
27
100
27
Vinegar
13.5
0
0
Total
67.5

31.05
Total weight after 10% losses
60.7 kg

28
% solids in batch before boiling = (28/60.7) x 100 = 46%
So 28 kg equals 46% of the batch before boiling. After boiling there is no loss of solids (only water is removed) but the solids content has been increased to 70%.
Therefore 70% still equals 28 kg.
Therefore the total weight of the batch after boiling = (100/70) x 28 = 40 kg

Weights of raw materials and ingredients

There are two stages involved in planning the amounts of materials that are needed to produce the required weight of product: first, it is necessary to calculate the amount of each ingredient that will be needed to formulate a batch of product and secondly, it is necessary to calculate the amount of losses that can be expected during preparation of fruits and vegetables.
The processor should experiment with different mixes of ingredients (the 'formulation' or 'recipe') to produce a product that has the colour, flavour, appearance etc. that consumers say they prefer from market research. Skill and flair are needed to achieve this, using the combination of ingredients that has the lowest cost. It is important to weigh each ingredient carefully and make sure that all weights are recorded for each formulation that is tried.
Otherwise, the inevitable result is a successful trial product, but no information is recorded to enable it to be repeated. Once a formulation has been successfully developed, great care is needed to ensure that it is made in exactly the same way on every occasion. This requires staff training, especially for those staff involved in batch preparation, the implementation of quality assurance procedures and careful production control. These aspects are discussed in more detail in Sections 2.7.1 and 2.7.2.
Nearly all fruit or vegetable processing results in losses of material. These may arise from peeling or de-stoning, from unsatisfactory fruits and vegetables that are thrown away during sorting, from spillage during filling into packs or from food that sticks to equipment and is lost during washing. Different types of fruit and vegetables have been found in practice to have different levels of wastage and examples of some of these are given in Table 17. Typical losses from other sources in a well-managed production process are shown in Table 18. However, it is necessary for an entrepreneur to do trials to calculate the actual amount of wastage experienced with the particular varieties of fruit or vegetable and with the particular process that are being used.
Clearly, it is in the interests of the processor to reduce losses as much as possible. Contracts with reliable suppliers (Section 2.6.1) help to ensure lower levels of poor quality raw materials and therefore reduce losses. Additionally, a well-managed processing operation, having good quality assurance procedures (Section 2.7.2), also reduces wastage, especially during later stages of a process when the product has a higher added value.
Using the data from experimental production trials, or less desirably estimates based on data in Tables 17 and 18, it is necessary to calculate the amount of raw materials and ingredients that are needed to produce the required weight of product each day. This will also enable the true cost of raw materials to be calculated for use in financial planning (Section 2.3.4)
Using mango chutney as an example. Figure 32 shows losses during each stage of the process. The amount of mangoes that need to be bought to produce the required weight for each day's production can then be calculated. The result indicates that only 45% of incoming raw materials were actually used in the product (27 kg of the 60 kg bought). If mangoes were bought for $0.2 per kg in season, the true cost of the fruit is calculated as $0.44 using the following formula:
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Other ingredient costs are estimated as follows: sugar $0.6/kg, vinegar $1.25 per litre and total spice costs of $1.3 per day. This data is used to calculate operating costs in Section 2.3.4.
Table 17. - Typical losses during the preparation of selected fruits and vegetables
Fruit or vegetable
Typical losses during preparation (%)
Notes
Apples
23
peeled & cored
Apricot halves
12
destoned
Bananas
41
peeled
Cabbages
30

Carrots
4
(bought without leaves)
Cauliflowers
38

Currants
3
seeds & skins removed
Figs
2

Grapes
19
skins & pips removed
Guava
22

Lemons
40
peel & seeds removed
Mangoes
45
peeled & destoned
Melons
42
peel & seeds removed
Okra
12

Onions
3

Oranges
25
peel & seeds removed
Passion fruits
58
peel & seeds removed
Pawpaws
38
peel & seeds removed
Peas
50
bought in pods
Peppers - chilli
15
seeds & stalk removed
Peppers - green
14
seeds & stalk removed
Pineapples
48
peeled & cored
Plantains
39
peeled
Tomatoes
4
seeds & skin removed
(Adapted from data in The Composition of Foods by Paul and Southgate, and from field data collected by the author)

Equipment required

Using the process chart (Figure 32), the weight of food that should be processed at each stage is then calculated in kg per hour. This information then allows the processor to decide what equipment is required and the size (or 'scale' or 'throughput') that is needed. In doing this, decisions need to be taken on the relative benefits of employing a larger number of workers or buying machinery to do a particular job. In some enterprise development programmes, there may be wider social objectives of employment creation which may influence such decisions.
The decisions on equipment requirements are also influenced by:
· the cost and availability of machinery
· the availability of people who are skilled in
· maintenance and repair
· the availability and cost of spare parts and
· the possibilities of local equipment fabrication.
Information on the types and suppliers of equipment is often difficult to obtain, but catalogues and sometimes databases of equipment manufacturers and importers may be available at offices of national and international development agencies, Chambers of Commerce, university departments, food research institutes, embassies of other countries and trade or manufacturing associations.
Table 18. - Typical Losses During Processing of Fruits and Vegetables.
Stages in a Process
Typical losses
Washing fruits/vegetables
0-10
Sorting
5-50*
Peeling
5-60
Slicing/dicing
5-10
Batch preparation/weighing
2-5
Boiling**
5-10
Drying**
10-20
Packaging
5-10
Machine washing
5-20
Accidental spillage
5-10
Rejected packs
2-5
* Unsatisfactory raw materials depend on source and agreements with suppliers
** does not include evaporation losses
It is preferable wherever possible, to buy equipment from local suppliers and fabricators because servicing and obtaining spare parts should be faster and easier. However, if equipment has to be imported, the following points should be considered: when ordering equipment, it is important to specify exactly what is required, as many manufacturers have a range of similar products. As a minimum, it is necessary to state the throughput required in kg per hour and the type of food to be processed. Where possible other information such as the model number of a machine, whether single or three-phase power is available and the number and types of spares required, should also be given. Assistance from a food technologist working in a local university or food research institute may be required to research and order equipment. The quotations received from equipment suppliers can then be used when calculating financial viability (below).

Packaging

Similar considerations apply when ordering packaging materials as there is a very wide range available and there are a number of considerations that should be taken into account by the producer. These include the technical requirements of the product for protection against light, crushing, air, moisture etc. (described in Section 2.5.5. and for individual products in Section 2.2), the promotional and marketing requirements (Section 2.8.3) and the relative cost and availability of different types of packaging. Selection of packaging materials frequently causes the largest problems for small producers and is often the main cause of delay in getting a business established. Professional advice should be soug

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